In FY08, we have focused primarily on elucidating the tumor cell-autonomous components of the switch in activity of TGF-beta from tumor suppressor to pro-progression factor. TGF-beta is a potent inhibitor of the proliferation of epithelial cells, and it has been widely assumed that this property is critical for the ability of TGF-beta to function as a tumor suppressor. However, we have identified a novel tumor suppression mechanism that is independent of direct effects on cell proliferation. Using a breast cancer xenograft model, we have shown that endogenous TGF-betas can suppress tumorigenesis by reducing the size of the putative cancer stem cell population and by promoting differentiation of the highly proliferative cancer progenitor cells. Experimental blockade of TGF-beta response in this model system converted the gene expression profile and histology of the tumor from a differentiated luminal to a less differentiated basal state, which previous clinical breast cancer studies have shown to be associated with a poorer prognosis. We identified the transcriptional regulator Id1 as a critical downstream target of TGF-beta in regulating differentiation, and we propose that molecular changes that block differentiation can selectively block this tumor suppressor effect of TGF-beta, thereby contributing to the metastatic switch. The TGF-beta signal is transduced by two structurally highly related proteins, Smad2 and Smad3, as well as by other signaling cascades such as the MAPK kinase and PI3 kinase pathways. We have hypothesized that the balance between these different signaling pathways may be critical in determining whether the output of the TGF-beta signal is tumor suppressive or tumor promoting. To systematically address this question, we have generated a panel of conditionally immortalized mammary epithelial cells from mice of differing Smad genotypes. This approach allows us more precise control over Smad2/3 levels than can be achieved through RNA interference approaches. We have found that the growth inhibitory and pro-apoptotic responses of the mammary epithelium to TGF-beta require only Smad3 and not Smad2. In contrast, the pro-migratory and pro-invasive effects of TGF-beta require obligatory cooperation between both Smads. The data suggest that Smad3 may be critical for both tumor suppressor and pro-progression responses, while Smad2 is more important for the pro-progression responses. In addition, there are interesting gene dosage effects in the requirement for Smad3, with loss of one allele of Smad3 resulting in loss of the pro-apoptotic response to TGF-beta, while still permitting the other responses. Thus, despite the critical requirement for Smad3 in both tumor suppressive and tumor promoting activities, a reduction in Smad3 is predicted selectively to promote progression. In support of this prediction, we have found that Smad3+/- mice have a higher incidence of metastasis in the MMTV-PVT transgenic mouse model of breast cancer. The potential association between Smad3 polymorphisms and risk of metastatic breast cancer will be investigated. The data from our lab and others implicates Smad3 in both the tumor suppressor and pro-progression effects of TGF-beta on the tumor cell. We hypothesize that genetic or epigenetic changes that occur during cancer progression may alter the Smad3-mediated readout of the TGF-beta signal so that tumor promoting activities dominate. To address this question, we have performed genome-wide chromatin immunoprecipitation to identify Smad3 targets in two closely related cell lines, MCF10Ca1h in which TGF-beta functions as tumor suppressor, and MCF10Ca1a in which TGF-beta functions as a pro-progression factor. Integration of the promoter occupancy data with global gene expression data has yielded core Smad3-based gene signatures that are associated with the two different outcomes. These signatures should yield important insights into mechanisms underlying the switch process, and will be exploited in gene expression based screens to find novel compounds that might reverse the switch and restore the tumor suppressor activities of TGF-beta.